US military officials say the small town in the country's southwestern region retaken with little resistance from ISIL.

Iraqi ground forces with US air support recaptured the southwestern town of Rutba after fighters from Islamic State of Iraq and the Levant - who had occupied the town for nearly two years - fled or put up only light resistance.

US Army Lt Gen Sean MacFarland, the top US commander in Baghdad, told reporters on Friday it was an important victory for the Iraqi security forces, even though Rutba is a small town.

MacFarland said taking Rutba from ISIL, also known as ISIS, will allow the reopening of the main road from Amman to Baghdad, which he said is a significant economic lifeline for Iraq.

"Although it's a small town, it's an important success for the Iraqi security forces," he said.

Another US officer, Marine Brig Gen Bill Mullen, said in a separate interview the decisive action in Rutba was US air strikes outside the town, which seemed to persuade ISIL fighters to flee rather than put up substantial resistance.

He said there were an estimated "couple of hundred" ISIL fighters in Rutba prior to the Iraqi assault, and by the time the Iraqis arrived all but about 30 had fled north to the city of al-Qaim, or across the border into Syria.

Iraqi ground forces move in

Col Steve Warren, spokesman for the US military command in Baghdad, said the Iraqis had sent about 1,000 troops to Rutba. They were a combination of federal police, Sunni tribal fighters, border security forces and members of the counter-terrorism force.

Warren said ISIL had used Rutba as a staging area for weaponry and foreign fighters flowing into Iraq.

Beyond recapturing Rutba, US officials were focused mainly on preparing Iraqi security forces for an assault on Mosul, which is ISIL's main stronghold in Iraq.

Asked whether he believes the assault phase of the Mosul operation will be launched before the end of this year, MacFarland said, "I really am reluctant to make predictions."

One factor weighing on the Iraqi campaign is the political paralysis that has gripped the government in Baghdad.

ISIL has also launched a series of deadly attacks in the capital, including suicide car bombings, apparently with the aim of sowing further discord within the government and causing it to pull some of its forces away from Mosul to help defend Baghdad.